The Horserace Betting Levy

The Horserace Betting Levy is collected by the Horserace Betting Levy Board (HBLB) from the gross profit of betting on British horseracing. The money raised from the Levy is applied for one or more of the following purposes:

• supporting breeds of horses;
• the advancement or encouragement of veterinary science and education;
• the improvement of horseracing.

The Levy raised £95m in 2017/18.

Extending the Levy

Until April 2017, the Levy did not extend to overseas betting operators. The British Horseracing Authority estimated that this cost the industry over £20 million annually in lost Levy receipts.

The Horserace Betting Levy Regulations 2017 came into force on 25 April 2017 and extended the Levy to all gambling operators offering bets on racing in Great Britain. The basis on which the Levy is calculated is now a fixed rate i.e. 10% of profits on leviable bets which exceed £500,000 in a Levy period (1 April to 31 March in any given year).

The revised Levy arrangement required state aid approval. This was received from the European Commission on 21 April 2017.

Administering the Levy

The Government wants to make changes to the Levy to "reduce financial and administrative burdens on the betting and horseracing industries". The changes will involve:

• transferring responsibility for collecting and enforcing the Levy from the HBLB to the Gambling Commission;
• transferring the responsibility for expenditure decisions and the distribution of the Levy to the racing industry. Levy funds will be passed to a nominated body which is representative of the British racing industry;
• as a result of transferring the above functions, closing the HBLB and abolishing the Horserace Betting Levy Appeal tribunals.

A Department for Digital, Culture, Media and Sport (DCMS) consultation on using a Legislative Reform Order to make the changes ran from 21 December 2017 to 16 February 2018. After analysing the responses, the Government decided to proceed with its plans. The draft Legislative Reform (Horserace Betting Levy) Order 2018 was laid before Parliament on 9 October 2018.

If approved, the Government's changes to the Levy would have taken effect from 1 April 2019. However the draft Order was considered by the House of Commons Regulatory Reform Committee and the House of Lords Delegated Powers and Regulatory Reform Committee. In reports published in December 2018, both Committees criticised the Government’s use of delegated legislation and said that primary legislation should be introduced instead.

In response to a December 2018 Lords question, the Government said that it was carefully considering the Committee reports.